South Africa

PRETORIA - The National Prosecuting Authority (NPA) cannot continue with the prosecution against African National Congress (ANC) president Jacob Zuma, says acting National Director of Public Prosecutions (NDPP) Mokotedi Mpshe. He adds that "it would be unfair as well as unjust to continue with the prosecution". Mpshe's announcement ends a long legal battle between the authority and the ruling party's presidential candidate. It follows weeks of media reports that the charges would be dropped amid news that the NPA was considering new representations on the case. Zuma was facing 16 charges linked to a multibillion-rand government arms deal, including one of racketeering, one of money laundering, two of corruption and 12 of fraud. In August 2003, the then NDPP, Bulelani Ngcuka, announced that Zuma's former financial adviser, Schabir Shaik, would be charged with corruption and fraud, adding that though there was a prima facie case against Zuma, the NPA would not be charging him because it did not believe the case was winnable. Zuma cried foul, claiming a political conspiracy aimed at derailing his bid to succeed Thabo Mbeki in the Presidency, an assertion he has maintained ever since. The NPA's dropping the charges means that, if Zuma is to become President after the April 22 elections, he will no longer have the charges hanging over his head.

JOHANNESBURG - The two main risks to South Africa's rating outlook are the global recession and continuing uncertainty about government policy after the elections, says Fitch Ratings. A leadership transition within the ruling African National Congress, followed by a split and the emergence of a viable opposition party ahead of this year's elections, have increased political uncertainty, and impacted on investor sentiment. Over the past year, Fitch has twice changed the outlook on South Africa's rating, from positive through to negative, in response to the fast deterioration in the global economy in the second half of 2008. South Africa's current account deficit is expected to narrow only slightly this year, making the country particularly vulnerable to adverse changes in investor sentiment. The ratings agency notes that inflation targeting and a flexible exchange rate framework are an important institutional strength, and comments that the South African Reserve Bank has not yet intervened to support the currency despite the sharp drop in the value of the rand, which is supporting South Africa's adjustment to the global economic slowdown.

Africa & the world

LONDON - World leaders have agreed on a trillion-dollar deal to combat the deepest economic downturn since the Great Depression. At a Group of 20 (G20) summit, leaders also signed off plans to commission blacklisting of tax havens and tighten financial rules to bring hedge funds and credit rating agencies under closer supervision. British Prime Minister Gordon Brown says that while there are "no quick fixes", the decisions mean that the recession can be shortened and jobs saved. French President Nicolas Sarkozy says that the results are beyond what could have been imagined. Germany's Finance Minister, Peter Steinbrueck, welcomes the fact that no obligation was agreed upon for countries to adopt further stimulus packages. The issue had created tension in the summit build-up, with Washington favouring such packages and Paris and Berlin preferring to let earlier measures take their course. The G20 leaders agreed to commit new resources of $1-trillion that are available to the world economy through the International Monetary Fund and other institutions.

LONDON - People will die in the world's poorest countries if rich nations push them aside in the scramble to escape the global economic crisis, says Egypt's Finance Minister Youssef Boutros-Ghali. Developed countries are borrowing heavily on international markets to fire up their economies, meaning that poorer countries are increasingly being pushed out. In emerging countries, an economic slowdown means that people are going to die. Development aid from the world's biggest donors rose to a record level in 2008, but donors will need to make substantial efforts to hit targets for 2010 because of the economic crisis, says the Organisation for Economic Cooperation and Development, which also predicts a 4,3% contraction in the economies of its 30 richest members this year. At the 2005 Gleneagles G8 summit, major donors pledged to double aid by 2010, amounting to an extra $50-billion globally, including $25-billion for Africa. The Millennium Declaration in 2000 set a goal of eradicating extreme poverty by 2015. Mark Malloch Brown, Britain's Africa Minister, says that the poverty goal could be hard to meet. It is estimated that 90-million more people will be in poverty by 2011 than had previously been assumed.

NEW YORK - United Nations secretary-general Ban Ki-moon welcomes the commitment by world leaders to provide $1,1- trillion in financing to help the world economy, but says it is vital that the poorest countries benefit. Ban says he is pleased with the package, which will be mainly channeled through the International Monetary Fund. He adds that the commitment of $300-billion in aid to the poorest countries over the next two years will be crucial. Ban also welcomes the commitment from Group of 20 leaders to resist protectionism and to monitor compliance, and praises the recognition of the need to tackle food security and climate change while dealing with the economic crisis.